To say Orange County's housing market got off to a rocky start in 2008 would be an understatement.

Sales and prices are down. But, perhaps more troubling, the total of 2,232 foreclosures during the first quarter was the highest in at least 20 years and up 328 percent from a year ago. During a similar period in the '90s slump, foreclosures rose at a 123 percent annual clip.

But things aren't tough all over. A report by DataQuick shows, as one might expect, Orange County's pricier ZIP codes, especially those along the coast, have hardly seen any foreclosures at all. (See chart of O.C. foreclosures)

Two sparsely populated ZIP codes, 92662 in Newport Beach (Balboa Island) and 92823 in Brea (next to Chino Hills State Park), did not lose a single home to the bank.

For each ZIP code, DataQuick provided the Orange County Register with a ratio of foreclosures in the first quarter per 1,000 houses and condos. The Register broke the ZIP codes into five groups (see accompanying map) via foreclosure density. Although difficult to quantify, foreclosures generally are seen as a drag on home prices and can cause blight, as homes are unattended.

Santa Ana tops the list of foreclosure concentrations with two ZIP codes – 92707 and 92701. Both have more than 10 foreclosures per 1,000 homes.

These two areas saw steep price declines in March. Last month's median price of $219,000 in 92701 was the lowest in the county and down 37 percent in a year. The median is the point at which half the homes sell for more and half for less. Only eight homes sold in the area in March. (See the chart of March home prices and sales)

Santa Ana's 92707 had a higher median at $372,500 last month, but it also dropped 37 percent (based on 21 homes sold).

Experts generally agree that foreclosures are spiking now because it was too easy to get a home loan during the housing boom. Loose lending combined with escalating home prices spurred speculators to buy several properties and resulted in others stretching to buy a home to live in, experts say.

With home prices sliding, a chunk of those buyers are giving properties back.

Each month foreclosures and short sales – when a bank agrees to accept less than debt on a property – take up a greater portion of homes on the market, according to Steve Thomas at Re/Max Real Estate Services in Aliso Viejo. In early April there were 5,335 such distressed properties on the market, up 42 percent from Dec. 27 and accounting for 34 percent of all properties for sale at the time.

Connie Der Torossian, a vice president with the Santa Ana-based nonprofit Fair Housing Council of Orange County, said while her group seeks to assist struggling homeowners from across all of the county, more than half come from Santa Ana.

She said owners generally failed to understand how much their loan payments would increase. Government data shows that in 2005, the peak of the housing boom, 75 percent of the loans in a census track overlying with ZIP 92701 were high cost subprime loans. (See "Street of broken dreams")

"Most got a loan from a friend, their friend the mortgage broker," Der Torossian said. "There was a sense of trust."

Der Torossian said she often tries to help owners by getting the lender to agree to reduce payments, but the process, if successful at all, takes three to five months.

For example, one of her current Santa Ana clients earns $2,000 a month and has a mortgage of $520,000, more than twice what she can afford. In that case, the lender would agree to reduce the mortgage to $338,000 – the home's current value – if the owner can get a refinance via a government program dubbed FHASecure.

Mark Boud, owner of market tracker Real Estate Economics in Irvine, said countywide foreclosures in the first quarter surpassed his forecast, but he still thinks they will peak in the second quarter. Most housing speculators have already either sold or given their homes over to the bank, he said.

He said foreclosures will "go down fairly sharply" after the peak, but they will continue to depress home prices until 2009. Hopefully by late 2009 or 2010 government initiatives will spur economic growth, which is good for the housing market.

Yet some experts disagree.

Walter Hahn, a real estate economist in Irvine, also said foreclosures either peaked during January's record high of 802 foreclosures, or they will by June. But it's not straight down from here, Hahn said.

The end of low introductory teaser rates on mortgages are spurring foreclosures now and will do so again in 2010 and 2011, when studies show many loans will see a jump in payments, he said.

"It's not over," Hahn said. "It's not going to be over until 2012."